Judges Grapple With New Mine Safety Issues (And One Old One)

Summer 2008

Co-Authors: Timothy M. Biddle and Daniel W. Wolff.

In this article we report on notable federal mine safety and health decisions issued over the past year by federal courts and the Federal Mine Safety and Health Review Commission. We summarize two important decisions from the U.S. Court of Appeals for the District of Columbia Circuit, one upholding the validity of MSHA's emergency response plan regulations and the other addressing MSHA's jurisdiction over a mine access road used for non-mining purposes; and a very recent Fourth Circuit decision on the discretion of MSHA to cite production-operators for Mine Act violations created solely by their independent contractors, a decision which largely tracks a 2006 decision from the D.C. Circuit. We also point out a decision from the federal district court in Utah holding that the media have no right of access to MSHA accident investigation interviews. And from the Commission we highlight two decisions of procedural importance, as well as a decision clarifying an operator's obligation to provide clear access to escapeways from longwall faces.

Emergency Temporary Standard for SCSRs Upheld
One of MSHA's regulatory actions following the Sago and Aracoma mine disasters in January 2006 set the stage for the first decision we review, the D.C. Circuit's 2008 ruling in National Mining Association v. MSHA. Following those accidents in West Virginia, MSHA published an emergency temporary standard ("ETS") in March 2006 requiring mine operators to, among other things, store additional self-contained self-rescuers ("SCSR") in a mine's escapeways. Under the Federal Mine Safety and Health Act ("Mine Act"), MSHA can issue an ETS without providing industry a preliminary opportunity to comment on the agency's rationale for the rule. The Mine Act does, however, provide an opportunity for public comment following publication, with the understanding that MSHA will address any concerns raised in a revised and "final" rule that it must publish within nine months of the ETS. Following that timeframe, MSHA received comments on the ETS during the spring and summer of 2006, and the final rule was published in December.

Spotting several legal deficiencies in the final rule, including inconsistencies between the rule and the Mine Improvement and New Emergency Response Act ("MINER Act") which Congress had enacted in June 2006, NMA challenged the rule in the U.S. Court of Appeals for the D.C. Circuit. Of chief concern was the final rule's requirement that individual caches of SCSRs be stored in each escapeway, as compared to a "common cache" of SCSRs that could be built in the stoppings between parallel escapeways – something proposed by industry and other health and safety experts – unless the common cache was designed to the same explosion-force criteria as seals. MSHA referred to this as the "hardened room."

NMA raised several objections. First, it argued that the MINER Act permitted the use of common caches other than the so-called hardened room, and that MSHA's rule therefore was invalid to the extent it was superseded by the newly enacted statute. Next, NMA contended that MSHA failed to give industry sufficient notice that the agency would be advancing the hardened room rule because that concept was not mentioned in the ETS. Finally, NMA said the final rule was arbitrary and capricious because it was far safer to store SCSRs in a common cache inside stoppings than to store them directly in each escapeway, where the devices would be directly exposed to mine emergency hazards such as fire, smoke, or explosion forces.

The court did not address the merits of the first argument even though it was central to NMA's challenge. The court said that the argument had not been raised during the rulemaking process and had therefore been waived. The court also rejected the notice and arbitrary-and-capricious arguments. It held that industry was given sufficient notice of the potential for a hardened room rule, as evidenced by the comments of many operators suggesting a less demanding common cache – the court reasoned that if operators knew enough from the text of the ETS to propose a common cache, surely they could have anticipated that MSHA might adopt a rule requiring any common cache to satisfy the hardened room requirements. The court noted that although this feature of the rule was not proposed as a rule per se, MSHA did solicit feedback at several public hearings on the idea of a "hardened room." The court also agreed with MSHA that requiring two sets of SCSRs – one in each escapeway – would provide for redundancy in the event one escapeway became impassable, and that in the absence of such redundant capacity, it was reasonable to require operators to store SCSRs in a "hardened" room that could withstand explosion forces.

A Road Is Not a "Mine," or Is It?
The second ruling from the D.C. Circuit concerns the very important question of MSHA jurisdiction over a road that is the exclusive access route to a mine, but also is used and traveled by entities and individuals other than the operator and its miners. The Mine Act defines "mine" to include "private ways and roads appurtenant to" mineral extraction areas. The National Cement Company of California, Inc. operates a quarry and cement processing plant on land leased from the Tejon Ranchcorp. To access its mine property, National Cement has a right-of-way over a 4.3-mile stretch of a 2-lane road extending from a state highway to the cement plant's entrance. What adds spice to this arrangement is that National Cement's right-of-way is not exclusive – the road is regularly used for multiple other purposes, by ranchers, sportsmen, the California Department of Water Resources, and even Hollywood film crews, among others. Although it is not contractually obligated to do so, as a matter of course National Cement has maintained the road over the years. In 1992, MSHA cited National Cement for not erecting berms or guardrails on the road but then vacated the citation on its own on the ground that the access road was not part of National Cement's mine.

In 2003, MSHA renewed its effort to regulate the road as a "mine" and again issued a citation to National Cement for failing to erect berms or guardrails. When asked about the inconsistency between issuing this citation and vacating the 1992 citation, MSHA agreed to vacate the later citation but then promptly wrote a letter to National Cement to give it "notice" that henceforth the road would be treated and regulated as a "mine." Sure enough, in 2004, MSHA issued another citation on the same grounds. National Cement challenged MSHA's jurisdiction to regulate the road, and Tejon intervened in support of that position. In agency proceedings, an administrative law judge ruled in MSHA's favor, but the Commission reversed, holding that if the road were a "mine" then National Cement would be strictly liable under the Mine Act for the acts of other parties over which it had no control (such as Tejon or the State Department of Water Resources), or those parties themselves could be potentially liable as "operators" if MSHA determined they exercised control over any portion of the road. Because either of those results would be absurd, the Commission held that Congress could not have intended for this road to be treated as a "mine."

MSHA petitioned the D.C. Circuit to review the Commission's decision. In Secretary of Labor v. National Cement Company of California, Inc., the court ruled in 2007 that the Mine Act's definition of "mine" was ambiguous with respect to roads such as that used by National Cement. Moreover, it largely agreed with the concerns raised by National Cement and Tejon with treating the road as a mine. Nevertheless, proceeding very cautiously in light of the general rule that agency interpretations of statutes they are charged with administering are entitled to deference if the statute is ambiguous, the court vacated the Commission's order and instructed MSHA to try again to explain why its interpretation should be given deference. In doing so, the court observed that it would be "difficult" for MSHA to harmonize its interpretation with the overall enforcement scheme of the Mine Act (given the concerns the Commission had raised) but said MSHA should at least be given another chance to do so.

Stay tuned for more on this case – the matter has been briefed to the Commission on remand and a decision is pending. There is a very good chance that whichever side does not prevail before the Commission will seek further review by the D.C. Circuit.

Production-Operators Always on the Hook for Conduct of Independent Contractors
Since the days of the 1969 Coal Act, production-operators have grappled with liability for the conduct of their independent contractors. A seminal case from the Fourth Circuit held that, under the Coal Act, independent contractors could be cited as "operators" in their own right, but also that production-operators would remain on the hook regardless of whether they were at fault for any part of the violation. With the passage of the Mine Act in 1977, and Congress's express inclusion of independent contractors within the definition of "operator" (which was not the case under the Coal Act), production-operators held out hope that the Commission and courts would recognize that Congress intended independent contractors to stand on equal footing with production-operators, and thus to bear sole responsibility for violations they caused in any case where the production-operator itself had nothing to with the violation.

Alas, such a plain and logical reading of the Mine Act did not come to pass. But all was not lost, and production-operators took solace in longstanding Commission precedent that recognized a right of production-operators to seek review of citations issued to them for violations caused by independent contractors under an abuse-of-discretion defense. This meant that not only could a production-operator challenge the fact of violation and the appropriateness of any consequent civil penalty, but it could also challenge MSHA's discretionary decision to cite it for conduct attributable to an independent contractor. And for almost 30 years there was peace in the valley.

But this peace was a restless one, for MSHA did not like the rule – in its opinion, the Commission had no business "second-guessing" its decision to cite a production-operator. Ever. Unfortunately for MSHA, it could never get a federal court of appeals to address the issue because it always seemed to win the "discretion" battle before the Commission or the ALJ. But in 2005, it lost: Twentymile Coal Company challenged several citations on abuse-of-discretion grounds and the Commission, applying its longstanding precedent, agreed with Twentymile and vacated the citations, observing that the violations were the result of the conduct of an independent contractor, whose operations Twentymile was not in a position to control. MSHA didn't like that decision and appealed to the D.C. Circuit.

Meanwhile, in West Virginia, Speed Mining, Inc. ("SMI") faced a similar situation – an independent contractor with extensive experience in sinking mine elevator shafts overlooked several safety violations involving a crane. The crane hoist failed and created a severe safety risk by causing a six-ton bucket to fall and land only a few feet from the mine shaft opening where five of the contractor's employees were working at the time. Taking the view that SMI should have exercised greater oversight over its independent contractor, MSHA cited both SMI and the contractor for the violations. SMI challenged the citations, invoking Commission precedent as had just been reiterated in the Twentymile decision. Following that precedent, the ALJ agreed with SMI and vacated the citations issued to it. Again MSHA sought review by the Commission, which granted review but immediately stayed the case in lieu of the Twentymileappeal pending before the D.C. Circuit.

Then the bottom fell out. In 2006, the D.C. Circuit reversed the Commission in Twentymile and held that the Commission and courts are without authority to review MSHA's discretionary decisions to cite production-operators for violations caused by independent contractors. SMI was caught in the wake of Twentymile – the Commission remanded SMI's case to the ALJ to apply the rule as articulated by the D.C. Circuit. But the fight did not end there. Recognizing that the D.C. Circuit is not the final authority on what the Mine Act allows, SMI maintained its defenses. As expected in light of Twentymile, the ALJ ruled in favor of MSHA and assessed civil penalties, and a subsequent petition to the Commission for review was denied. The stage was set for appeal to the Fourth Circuit in Richmond, and SMI had the audacity of hope – hope that another court would read the statute for what it says, and not feel constrained by the decision of the D.C. Circuit.

Before the Fourth Circuit, SMI struck at the very premise of MSHA's discretion to cite production-operators when they had nothing to do with causing the violation, contending that the Mine Act permits MSHA to cite only the operator responsible for the violation. Although SMI acknowledged that liability under the Mine Act is "strict," that form of liability usually only runs to an entity that had control over the conditions giving rise to the violation; without control, there should be no liability. In so arguing, SMI asked the court to recognize that its Coal Act precedent was neither on point nor binding in light of the amendment Congress made in 1977 to include independent contractors in the definition of "operator." SMI also repeated its argument that to the extent MSHA had the discretion to cite production-operators in such cases, the Commission and courts could review MSHA's decision to do so for abuse of discretion.

But in Speed Mining, Inc. v. FMSHRC, the Fourth Circuit took the easy path, siding with the D.C. Circuit and following its own Coal Act precedent in refusing to grant SMI the interpretation of the Mine Act it sought. It said that the Mine Act defines "operator" to include many different entities, and that all operators are strictly liable under the Mine Act, meaning that there is an implicit discretionary right of MSHA to cite whichever operator the agency chooses should be held responsible for a violation, even if that particular operator had nothing to do with causing the violation. It also held that MSHA's discretionary decisions cannot be reviewed because to do so would be to second-guess the policy choices of MSHA, a role that Congress did not intend the Commission or courts to play, and that they are not equipped to play.

No Right of Media Access to Accident Investigation Interviews
As sure as day follows night, the media will cover a major mine accident and will want to attend MSHA's accident investigation interviews of miners. But, as has the been the case in every accident investigation since 1985, MSHA will not allow media reporters to attend its investigation interviews. This scenario was repeated following the Crandall Canyon Mine accident in August 2007. This time, however, the media went to federal district court in Salt Lake City seeking an order compelling MSHA to let the media attend the accident investigation interviews.

In Salt Lake Tribune v. Chao, media lawyers argued that the public has a right under the First Amendment of the Constitution to attend (via a media reporter) MSHA's investigation interviews. The media had to elevate the argument to a constitutional one because there is nothing in the Mine Act or any other statute that limits MSHA's authority to restrict attendance at its accident investigation interviews.

The court made short work of the media's arguments, holding in October 2007 that there is nothing in the First Amendment or in any statute that gives the media or the public a right of access to MSHA accident investigation interviews. In short, MSHA is free under the Constitution, as well as federal and Utah law, to restrict its accident investigation interviews to the witness, his or her representative, a state representative, and a court reporter. That means no company, union, or media representative can be present during accident investigation interviews unless MSHA says so.

Commission Reaffirms Two Opportunities the Challenge Enforcement Proceedings
One of the peculiarities of enforcement proceedings under the Mine Act is that an operator has two opportunities to challenge enforcement actions – once when a citation or order is first issued, and later (often many months later) when a civil penalty is proposed. In two recent cases, the Commission grappled with complications that arise under this two-track arrangement.

The first case illustrates the strategy that when mine operators are issued a high number of citations and orders over a short period of time they sometimes exercise their right under § 105(d) of the Mine Act to file a pre-penalty contest to each citation and order within 30 days after the date it was issued but often do not press for a quick hearing. While there may be other reasons for filing a pre-penalty contest, the most common reasons are to get a case underway so the operator can begin discovery and can try to convince an MSHA attorney that the citation or order should be vacated (or the inspector's allegations of negligence and gravity should be reduced) without waiting the many months it takes for a civil penalty case to commence.

This was the strategy employed by Marfork Coal Co. when it filed pre-penalty contests on three citations and then agreed to continue them until penalties were assessed for the citations. But what Marfork didn't expect was the administrative law judge's "I've had enough of this" reaction: he issued an order to Marfork to explain why the pre-penalty contest cases should not be dismissed because they "constituted a needless and duplicative consumption of Commission resources." When Marfork gave the usual answer ("we want to begin discovery and be able to discuss settlement") the judge responded by dismissing Marfork's pre-penalty cases, saying that the company could have its discovery and plenty of time to discuss settlement after penalties were assessed and contested for the alleged violations. (While that may seem a judicial overreaction for just three citation contests, other judges already had dismissed pre-penalty contests where the operator did not want to go to a hearing rapidly. For instance, in a case decided in November 2006, one operator (Arcoma Mining Co.) had filed 375 contest cases and asked that they all be stayed until penalties were assessed on the contested violations.) Marfork (represented by Robert Beattie, a former Commissioner) appealed to the Commission, which in August 2007 reversed the administrative law judge in Secretary of Labor (MSHA) v. Marfork Coal Co., Inc..

The Commission held that § 105(d) gives mine operators the absolute right to file pre-penalty contests. But to simplify the Commission's handling of large numbers of pre-penalty contest cases where no rapid hearing is desired, the Commission said all § 105(d) pre-penalty contests will be stayed automatically (and not even assigned to an ALJ) until penalties are assessed and contested, unless the operator asks for a pre-penalty hearing. In so holding, the Commission observed that Marfork's reasons for filing pre-penalty contests (initiation of discovery and settlement possibilities) were valid.

Was this much ado about nothing? Hardly. In the first five months of 2007, about 475 pre-penalty contest cases were filed at the Commission. In the first five months of this year, 1168 pre-penalty contests were filed, an increase of about 700 cases. At this rate, by the end of 2008, the Commission estimates that it will have more than 2000 pre-penalty contest cases pending.

The second Commission decision, United Mine Workers of America v. Maple Creek Mining, Inc., examined the inverse of the issue posed in Marfork: whether a withdrawal order issued under § 104(b) of the Mine Act could be contested in a civil penalty proceeding even if it had not been contested earlier in a pre-penalty "contest" proceeding. At first blush, one might wonder why the Commission bothered reviewing the case, since it has long recognized that operators have two opportunities to contest violations: either in a pre-penalty "contest" proceeding under § 105(d) or a "civil penalty" proceeding under § 105(a). The distinction of this case rested with the character of the challenged paper – a withdrawal order as compared to a citation. As it turns out, this was a case of first impression.

The background was that Maple Creek and MSHA entered into a settlement agreement related to multiple violations, pursuant to which Maple Creek agreed to pay a penalty on a § 104(a) citation stemming from a violation caused by an ineffective bleeder system. This was the violation that was the subject of the § 104(b) withdrawal order. The order, in turn, was vacated as part of the settlement agreement which was approved by the administrative law judge. Enter the UMWA. The UMWA had separately filed a claim seeking lost compensation on behalf of the miners who had been idled on account of the withdrawal order. The compensation case was before a different judge. With its settlement order from the penalty case in hand, Maple Creek moved for summary decision in the compensation case, contending that the requirement to pay lost wages can only be triggered by a final withdrawal order, and that because the withdrawal order had been vacated, it could not serve as the basis for UMWA's compensation claim.

The judge in the compensation case ruled for UMWA, finding that the § 104(b) withdrawal order did not allege a separate violation and that MSHA had only actually issued a penalty on the underlying § 104(a) citation, not the § 104(b) withdrawal order. He therefore concluded that the withdrawal order had not properly been part of the civil penalty proceeding, meaning that there really was no withdrawal order to vacate. In the judge's opinion, Maple Creek's sole avenue for contesting the withdrawal order was through a pre-penalty contest proceeding, which it did not file. Concluding that the withdrawal order was still effective, the judge permitted the compensation claim.

The Commission reversed the ALJ in July 2007, pointing out that its precedent and its own rules of procedure do not distinguish between "citations" and "orders" when it comes to the two opportunities operators have to lodge a challenge. It stated that although operators "have the right under section 105(d) to contest citations and orders earlier instead of waiting for a penalty assessment, that right does not diminish their options under section 105(a)." The Commission also pointed out that the UMWA's position was absurd because it would foreclose an operator from contesting a withdrawal order, and thus require it to pay "lost compensation," even if the § 104(a) citation that preceded the withdrawal order was found to lack merit in a separate contest or civil penalty proceeding.

Escapeways Must Be "Travelable"
In Secretary of Labor (MSHA) v. The American Coal Co., American Coal challenged citations issued for violation of 30 C.F.R. § 75.380 at its Galatia Mine when stage loaders moved during longwall operations into a position that forced face crews to crawl over them to reach the section escapeways. American argued that by its terms the escapeway regulation does not apply inby the section loading point (escapeway required from "each working section"; working section defined to begin at the loading point of a section). Since the area cited was inby the belt tailpiece, which was the section loading point, no violation could have occurred. MSHA said that because escapeways must be maintained in "travelable condition," access to an escapeway must be travelable as well. MSHA argued that "travelable" does not include crawling over a stage loader.

In a December 2007 decision, the Commission upheld the violations, but not for the reason MSHA had urged. Instead, the Commission held that since § 75.380 requires operators to "provide" escapeways from working sections, any substantial hindrance or condition that impedes miners from accessing escapeways violates the standard. The Commission found that Galatia didn't provide escapeways to its longwall face crews when the location of Galatia's stageloaders required the miners to crawl over them to access the escapeways.

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